Dodge v. Ford Motor Co. (Mich. 1919)
[Policy Case]
-The Plaintiff shareholders were direct competitors with Ford. Case was about
whether Ford should be allowed to hold off paying of extra dividends, in part to
expand its manufacturing capacity.
-Court affirms the primacy of shareholder profits as the purpose for business
corporations, but says it should not interfere with long-term planning.-Court rules that Ford must pay dividends to shareholders.
Note that Ford was a pioneer in finance and the court probably didn’t pick up on all
the factors involved.
[Policy Case]
-The Plaintiff shareholders were direct competitors with Ford. Case was about
whether Ford should be allowed to hold off paying of extra dividends, in part to
expand its manufacturing capacity.
-Court affirms the primacy of shareholder profits as the purpose for business
corporations, but says it should not interfere with long-term planning.-Court rules that Ford must pay dividends to shareholders.
Note that Ford was a pioneer in finance and the court probably didn’t pick up on all
the factors involved.
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